Do Part Time Employees Get Benefits? - The Full Guide
Due to federal, state and local regulations and laws, it can often be difficult to know what exactly you are allowed to offer part time employees when it comes to additional benefits.
Pleasing to most people though, employers do have a lot of wiggle room when it comes to what they are allowed to offer their part time employees, but they have to be careful and always bear in mind the laws surrounding their plans.
This guide will aim to help you understand how benefits for part time employees can work, along with the key questions that come with part time employment.
What Exactly Is A Part Time Employee?
A part-time employee is a worker who is employed for less hours than is deemed to be full time. In the US, that is defined generally at a maximum of 34 hours per week but the number of hours offered for part time employees will be dependent on the business.
However, the Fair Labour Standards Act (FLSA) doesn’t explicitly give a difference between part time and full time employees, so employers need to make these decisions - but they must be wary over local and state laws when it comes to their offerings.
Typically, there is a minimum of 20 hours a week for a part time employee, but this isn’t categorized by the FLSA. It’s wise for employers to create a clear guideline in their employment process and employee handbook as to what the business defines as part time and full time.
Why Hire Part Time Employees?
There are various reasons why a business might employ people on a part time basis over full time employment. They might have a business that is in a period of growth but cannot at that time afford to employ somebody full time.
Additionally, a full time employee might be deemed unnecessary due to the needs of the business. In fact, in some respects - an employer might decide not to employ either and might opt for freelancers or contracted employees.
For example, it is not usually needed to have cleaners on a full time employment basis as the employer would need to pay more hours in salary. Generally, a cleaner would work in the morning and evening and not throughout the day.
There are of course, always going to be disadvantages to hiring a part time employee over a full time employee, particularly when the business begins to boom and grow much larger. Many part time employees will be attracted to the position because the hours work around their life.
What Is The Deal With Part Time Employees’ Benefits?
When it comes to the employer offering benefits for part time employees, it is typically their discretion as to what they wish to offer and what benefits we are talking about.
There are benefits that are classified as statutory such as social security or worker compensation insurance. This in essence, means that you are always entitled to these.
There are some benefits though that an employer can decide to offer a part time employee which will entice them much more to join your business rather than elsewhere. It can also mean that you can decide to only hire the best and make the recruitment process more stringent.
Below are a list of benefits that a part time employee could potentially be offered by an employer:
Health insurance is a big attractive factor for US citizens when it comes to accepting job offers, so having a good health plan as part of your policies can be a fantastic recruitment tool.
You’ll notice in some companies that they offer health insurance to full time positions but not for part time positions - so having this can be a unique selling point, and it’s ethically positive too.
This becomes slightly more complicated when we consider the Affordable Care Act (ACA) which requires businesses that employ fifty or more employees to offer an affordable health plan - but this only applies to full time employees.
Full time in this instance is actually specifically defined as an employee who works thirty or more hours a week. However, for an employee to be classified as entitled to health insurance will have many more factors involved.
This might include the insurance provider’s specific policies, federal, local and state law and plenty of others. Typically, an insurance provider will have a minimum amount of hours for an employee to work at a workplace for health insurance to be provided, which is generally about 20 hours a week.
401k plans or retirement plans can often be very confusing when it comes to part time employment. The Employee Retirement Income Security Act (ERISA) suggests that part time employees might be entitled to be included in this type of plan.
Of course though, it’s not as black and white as that. Much like the previous point with health insurance, there might be a minimum amount of hours that are required before an employee has to be included in this sort of benefit.
There is a specification by the Inland Revenue Service (IRS) that an employee should be included in an employer sponsored 401k retirement plan if they have worked one thousand or more hours in a year.
Extra specification is included in the Setting Every Community Up for Retirement Enhancement Act (SECURE) of 2019 that says if a part time employee has worked for three years for the same employer at 500 hours each year - they should include them by offering the same 401k retirement benefit plan.
Company Specific Benefits
Depending on the employer and the nature of the business, an employer might offer a part time employee perks and benefits of working for them. The limit to this might depend on local and state laws, but if the employer chooses to - they could offer things like:
Company coffee rewards
Company cell phone
What About Unemployment Benefits?
You might be wondering as a part time employee if you’re also entitled to unemployment checks. The short answer is yes, part time employees can receive unemployment benefits but the hours restrictions worked will differ from state to state, so it’s worth checking beforehand.
What About Holiday And Overtime?
There is nothing in law that says a part time employee is entitled to holiday pay, but an employer can offer this as standard if they wish. However, all employees are covered with overtime hours pay, assuming they are not exempt.
Are Part Time Employees Entitled To Vacations?
Again, there’s nothing that explicitly states that part time employees must have vacation time so it is down to the employer if they wish to offer such a benefit. Having said that, they might find it in their interest to keep an employee happy to boost productivity and curtail any sick leave.
Part time employees are entitled to specific benefits but others are down to the employer, should they wish to include them as a standard recruitment offer.
If you haven't got the most efficient way to produce paystubs for your employees, check out the pay stub maker today.